Just before Parliament broke for its summer recess, rumours swirled that a new £10 billion-a-year health and care levy would be introduced this autumn. Funded through an increase in National Insurance contributions, the funds from the levy would initially focus on tackling the growing backlog for NHS care, before shifting towards supporting social care services in the medium to long term. But alongside issues of equity, there are two problems that mean this levy could be more trouble than it's worth.
First, a front-loaded fund of this magnitude and profile could be a poor fit for what the NHS needs to tackle the backlog of care. Long gone are the days when there was surplus capacity in the public and private hospital sector that could keep operating theatre lamps burning through the evenings and weekends so long as the short-term injections of cash continued.
At the moment, more staff - who take time to train or recruit - would be needed to fill existing vacancies and deliver a new push on electives; existing staff are at risk of burnout after what they have endured during the pandemic; many senior NHS staff would turn down the offer of additional work because of the pensions tax implications; and private sector capacity will be heavily reliant on the availability of NHS staff. Put simply, it is not clear what all of this extra money could buy.
'...a new health and care levy will only be effective if it accompanies the funded health and care people plan that has been repeatedly promised in recent years.'
Tackling the NHS backlog is likely to be a marathon not a sprint. And if the number of clinical staff is the key factor affecting this race, a new health and care levy will only be effective if it accompanies the funded health and care people plan that has been repeatedly promised in recent years.
Second, there are serious doubts over whether the focus of the fund could ever break free of the NHS's gravitational pull. Any extra NHS spending that was spent on recurrent items (eg, salaries for newly hired staff) rather than one-off initiatives (eg, short-term appointments or overtime payments to existing staff) would lock in funding commitments for the NHS and squeeze out future levy funding for social care.
There is previous form here with the Sustainability and Transformation Fund, which was created in 2015 to help NHS providers achieve financial balance (the 'sustainability' part) and integrate services to deliver better care for patients (the 'transformation'). Years later, when he was asked at a Health Select Committee if the Sustainability and Transformation Fund was ultimately about sustaining rather than transforming, Sir Simon Stevens, head of NHS England, said 'Yeah, I agree with that. I think the "T" was probably a misnomer and that's why we dropped it'. The fund was eventually rechristened as the Provider Sustainability Fund.
There is every risk that in time social care would be dropped from the newly proposed health and care levy, despite there being no reason why social care services should be asked to patiently stay on the funding waiting list when both the Prime Minister and Secretary of State for Health and Social Care have said social care funding reform is an urgent priority for this government. If that is really the case then a concurrent, rather than sequential, funding plan for health and care services is surely what is needed.
'Social care and health services need additional funding to tackle rising waiting lists and improve services. But the public awareness of social care is low...'
The short-term tactics behind a combined health and care levy are clear. Social care and health services need additional funding to tackle rising waiting lists and improve services. But the public awareness of social care is low while the NHS has great brand recognition. So, sticking an NHS badge on the levy lubricates the process of getting more funding for health and care services over the coming years.
But the health and care sectors - and the patients, users, families and carers who rely on them - need a coherent strategy as well as more funding. They need the social care reform plan the Prime Minster promised, a funded national workforce strategy for the NHS and social care, and a long-term plan for how the NHS backlog can be addressed.
There are more than 5 million people waiting for routine hospital care, and 1 in 8 people waiting for a social care needs assessment have been doing so for more than 6 months. More funding is clearly needed to help health and care services recover. But there are few convincing arguments for why this funding can't be raised in the same way as the £200 billion we already spend on health and care. A combined health and care levy may make short-term political sense, but it could ultimately create the mother of all headaches for the health and care sector and political leaders alike.